Pierce v. Commercial Warehouse

142 F.R.D. 687, 24 Fed. R. Serv. 3d 472, 1992 U.S. Dist. LEXIS 9227, 1992 WL 146616
CourtDistrict Court, M.D. Florida
DecidedJune 22, 1992
DocketNo. 86-203-CIV-T-17
StatusPublished
Cited by12 cases

This text of 142 F.R.D. 687 (Pierce v. Commercial Warehouse) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pierce v. Commercial Warehouse, 142 F.R.D. 687, 24 Fed. R. Serv. 3d 472, 1992 U.S. Dist. LEXIS 9227, 1992 WL 146616 (M.D. Fla. 1992).

Opinion

ORDER ON MOTION FOR SANCTIONS

KOVACHEVICH, District Judge.

This cause is before the Court on the following:

Dkt. 264 Defendants’ Motion for Sanctions

Dkt. 265 Memorandum

Dkt. 296 Supplemental Memorandum

Dkt. 297 Plaintiffs’ response

Dkt. 298 Memorandum

Dkt. 300 Defendants’ Reply.

Plaintiffs have requested oral argument. The Court finds that an evidentiary hearing is not necessary; the request for oral argument is denied. Partial Joinder of Defendants (Dkt. 271) is granted.

Defendants seek entry of sanctions as to Plaintiffs on the basis of four allegedly frivolous and vexatious motions:

1. Plaintiffs’ Sherman Act claims;

2. The class action/representative claim of J.A.B.B.;

3. Plaintiffs’ motion for summary judgment;

4. Plaintiffs’ motion for new trial.

Rule 11, Federal Rules of Civil Procedure, mandates a reasonable prefiling inquiry with respect to the facts and the law on which a paper is based. Rule 11 specifies that papers must be well-grounded in fact and warranted by existing law or by a good faith argument for the extension, modification, or reversal of existing law. Rule 11 further specifies that papers may not be interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation. Rule 11 directs the court to impose on counsel or the client sanctions, including reasonable attorney’s fees for violation of the rule.

Where a motion is made, Rule 11 gives the attorney’s signature the effect of certifying that reasonable factual and legal support for it exists. A court has the right to expect that counsel will state the controlling law fairly and fully. A lawyer must not misstate the law, fail to disclose adverse authority not disclosed by his opponent of which he knows or should know, or omit facts critical to the application of the rule of law relied on. If the rule on which he relies is circumscribed or conditioned so as to preclude its application to the case, he is obligated to disclose that fact. If he knows another rule such as the statute of limitations, res judicata or collateral estoppel categorically bars his client’s claim, he cannot fail to disclose it in the hope that it will be overlooked. These are well-settled principles. See Schwarzer, “Sanctions under the New Federal Rule 11—A Closer Look,” 104 F.R.D. 181, 201 (1985).

Rule 11 requires that an attorney argue by analogy or extension from existing law; he can urge that existing law should lead to a result in the particular case even if that issue has not been ruled on. What an attorney cannot do is to mislead the court by contending that his argument is supported by existing law in the sense that the issue has been decided when that is not true. An attorney must be clear in presenting his argument for what it is— if acceptance of the argument would require the extension, modification or reversal of existing law, Rule . 11 requires disclosure and precludes presentation of the argument as though it rested on existing law.

Rule 11 is further directed at papers which are found to be interposed for an improper purpose, such as to delay, hinder or to needlessly increase the cost of litigation. The Court is not required to delve into the attorney’s subjective intent in filing his papers; Rule 11 incorporates an objective standard. Improper purpose may be shown by excessive persistence in pur[691]*691suing a claim or defense in the face of repeated adverse rulings or by obdurate resistance out of proportion to the amounts or issues at stake. Rule 11 is intended to reduce frivolous claims and to deter costly meritless maneuvers, thereby eliminating delay, and reducing the cost of litigation.

The Court is reminded that it must “avoid using the wisdom of hindsight” and must test the signer’s conduct by inquiring what was reasonable to believe at the time the pleading, motion or other paper was submitted. Reasonable inquiry includes consideration of the amount of time available to the signer, whether the signer had to rely on his client for information, whether the pleading sets forth a plausible view of the law, or whether the signer depended on another member of the bar.

The purpose of Rule 11 is to reduce frivolous claims, defenses or motions and to deter costly meritless maneuvers, thus avoiding unnecessary delay and expense in litigation. Donaldson v. Clark, 819 F.2d 1551, 1556 (11th Cir.1987) (citing Report of the Judicial Committee on Rules of Practice and Procedure, App. C (Mar. 9, 1982) (letter from Judge Walter Mansfield, Chairman, Advisory Committee on Civil Rules), reprinted in 97 F.R.D. 190, 192 (1983)); see also Advisory Committee Note. “Rule 11 sanctions are designed to ‘discourage dilatory or abusive tactics and help to streamline the litigation process by lessening frivolous claims or defenses.’ ” Donaldson, 819 F.2d at 1556 (Quoting Advisory Committee Note).

FINDINGS OF FACT

1. In their February 21, 1986 verified Complaint, Plaintiffs allege a conspiracy among the Defendants to restrain and control prices, fix, maintain and stabilize prices, boycott Plaintiffs, and attempt to monopolize the automotive parts industry. Plaintiffs charged Defendants with “price fixing, exchange of price information, tying, exclusive dealing and boycott agreements and combinations as a part of an overall combination among the Defendants to control the prices, exclude competition, cartelize, restrain trade, and otherwise monopolize the sale of automotive parts on the West Coast of Florida and elsewhere.” (Complaint, P. 21).

2. Defendants devoted major parts of their May 9, 1986 motions to exposing the inadequacies of these claims.

3. On June 4, 1986, Plaintiffs filed an amended complaint which abandoned all Sherman Act claims and which stated only a Robinson-Patman claim and state law claims.

4. Plaintiffs attempted to bring this action as a Rule 23 class action on behalf of J.A.B.B., an entity which was set up as a propaganda and fund-raising device for purposes of this litigation. J.A.B.B. turned out a stream of press releases and mailings to jobbers around the country, referring to this lawsuit and requesting money, when in fact this entity lacked standing to pursue the claims alleged in the Complaint.

5. In the first Complaint, the Amended Complaint and the First Amended Complaint, Plaintiffs alleged that the action was brought on behalf of themselves and all members of J.A.B.B. J.A.B.B.’s pleas for money referred to the case as a class action suit.

6. Defendants’ May 9, 1986 motions to dismiss the first complaint highlighted J,A.B.B.’s lack of standing and its inability to meet the requirements of Rule 23, Fed. R.Civ.P., or Local Rule 4.04. J.A.B.B.’s standing was untenable because it did not buy or sell automotive parts and made no allegation that it had suffered injury to its own business or commercial interests. Defendants renewed these objections in their June 30, 1986 motions.

7. The Court granted Defendants’ motions, following a hearing before Magistrate Wilson, at which Plaintiffs acknowledged that J.A.B.B.

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142 F.R.D. 687, 24 Fed. R. Serv. 3d 472, 1992 U.S. Dist. LEXIS 9227, 1992 WL 146616, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pierce-v-commercial-warehouse-flmd-1992.